Bitcoin ATM is a type of Crypto ATM, which is a stand-alone kiosk that you can use to buy and sell cryptocurrency. You can either use cash or a card to buy Bitcoin. In general, you can find Bitcoin in all crypto ATMs. Furthermore, some ATMs also allow dealing with other cryptocurrencies. Hence, it is important to learn how to get a Bitcoin ATM.
However, Bitcoin ATMs do not connect with your bank account. You will need to connect them with a digital wallet if you want to process a transaction.
In this article, you will learn how to get a Bitcoin ATM and the workings of crypto ATMs in general. Furthermore, this article also explains the prices of Bitcoin ATMs and shows you how to use them to deal with Bitcoins. Finally, you will learn the pros and cons of Bitcoin ATMs in brief.
What Is A Bitcoin ATM?
According to BankRate.com, “Bitcoin ATMs, sometimes referred to as BTMs, are kiosks where customers can buy and sometimes also sell Bitcoin, a type of cryptocurrency. Bitcoin ATMs are owned and operated by third-party companies — the two largest networks are Coinhub and Coinme. To use a Bitcoin ATM, customers can simply insert cash or a debit card to exchange their traditional currency for Bitcoin currency.”
Generally, anyone can access a Bitcoin ATM. However, the user needs to have an account with the Bitcoin ATM operator. Basically, cryptocurrencies like Bitcoin do not work through a bank account but work as per the blockchain technology. Hence, the cryptocurrency that you buy from the ATM is virtual.
As a result, when you exchange a currency in a Bitcoin ATM, it will not appear in your bank account. Rather, it will show up in your digital Bitcoin wallet.
How Does A Bitcoin ATM Work?
According to Investopedia, “Crypto ATMs connect to a cryptocurrency exchange and convert deposited cash into crypto. Transactions are processed on the blockchain, which is a digital ledger of financial transactions for cryptocurrency. Using a crypto ATM involves connecting a user’s digital wallet (typically via a quick response [QR] code), depositing cash, and transferring the purchased cryptocurrency directly to the digital wallet.”
In other cases, there are apps available for Bitcoin ATMs as well. These apps help you to redeem vouchers for your purchases. Furthermore, with the help of these apps, you will be able to deposit funds as well. Apart from that, these apps also let you choose your crypto and print your voucher. You can then scan the voucher with your mobile to redeem it. As a result, you can deposit the funds into your user wallet.
Moreover, you might find that some Bitcoin ATMs do not allow you to make two-way transactions. Although you can buy a Bitcoin from the ATM, you cannot sell one.
The selling process in Bitcoin ATMs works similarly to buying. All you need to do is scan the QR code of your digital wallet. Then, you have to choose how much crypto you want to sell and receive cash from the ATM after the transaction. However, in some cases, you will have to verify your photo ID.
How To Get A Bitcoin ATM? – Locating A Bitcoin ATM
Bitcoin claims – “You can buy Bitcoin and other cryptocurrencies with cash or credit from one of the thousands of Bitcoin ATMs around the world. Many Bitcoin ATMs also enable you to sell Bitcoin and receive cash. This article provides an overview of the process. Using a Bitcoin ATM is one of several ways to buy and sell Bitcoin.”
There are more than 36,000 Bitcoin ATMs available in the United States alone. There are several apps available that can help you locate the nearest Bitcoin ATM.
Coin Telegraph states – “Most BTMs are found in cafes or specialty shops, as well as transport hubs like rail stations and airports. Generally, business owners who would want to have a BTM installed inside a commercial space will have to enter into a contract with a Bitcoin ATM provider. The provider will then take care of installing the device on-site.”
These ATMs are run by ATM providers, which are generally companies. Hence, the features and function of one ATM depend on the workings and policies of the company.
What Are The Fees Of Bitcoin ATMs?
There are high transaction fees in Bitcoin ATMs. This is quite higher than Bitcoin exchanges. Many reports from a variety of sources inform that some Bitcoin ATMs even charge upto 20% of the transaction that you do. In some cases, they do not even disclose the total cost to their consumers.
However, on the other hand, there are certain crypto exchanges that allow you to continue your transaction with fees less than 1%.
Furthermore, apart from transaction fees, some Bitcoin ATM companies might also charge a variable miner fee. Basically, you will need to pay this fee to miners, who will add your transactions to the blockchain for validation.
Hence, before you consider using a Bitcoin ATM to buy or sell Bitcoins, make sure you research the fees of the ATM first.
How To Use A Bitcoin ATM? – Buying/Selling Bitcoin From An ATM
According to Bitcoin’s official website, “When you purchase bitcoin, you need a place to store it. A Bitcoin wallet is a digital tool that allows users to store, send, and receive bitcoin securely. Creating a Bitcoin wallet is as easy as installing an app, like the Bitcoin.com Wallet app, on your mobile device or laptop/desktop. When you install the app, your Bitcoin wallet is automatically created.”
You can use a Bitcoin ATM to either buy or sell Bitcoins. Based on what you want to do, here are the steps you need to take:
How To Buy From Bitcoin ATMs?
The following are the steps you need to follow to buy Bitcoin from a Bitcoin ATM:
- To verify your identity, insert your phone number. You will then get a verification code before you proceed with the transaction.
- Make sure you do the Know Your Customer (KYC) verification, as well as agree to the Anti-Money Laundering regulations. In some cases, as per law, Bitcoin ATMs need to have some form of identity verification, like a government-issued ID.
- Scan the QR code on the ATM with your mobile app. (Here, you will need to make sure that you have a Bitcoin address).
- Insert the fiat currency against how much you want to exchange for Bitcoin.
- Once you get the prompt of the Bitcoin value, confirm the amount and complete the transaction. However, before confirmation, make sure to double-check the transaction.
How To Sell Through Bitcoin ATMs?
Before you try to sell Bitcoins through a Bitcoin ATM, make sure that the machine has the selling option in it. Furthermore, check whether there are specific directions in the machine. However, in general, this process is quite similar to buying. Hence, it will not be a lot of problems in your case.
The following are the steps you need to take to sell Bitcoin through a Bitcoin ATM:
- In the Bitcoin ATM, choose the “Sell BTC” option. This will allow you to cash out Bitcoin.
- Scan the QR code of your wallet with your mobile app. Print out the code. You need to use this print in the ATM. However, some ATMs allow you to manually enter your address, if you prefer it that way.
- Once you try to transaction through the ATM, you will need to verify your identity. Here, too, you might need to enter your phone number for verification. Apart from that, you need to add a valid ID, or take a photo for the same. In some cases, you might accept fingerprints. In general, verifications are absolutely mandatory, if you are doing a transaction of a large amount.
- Send the crypto to the right address. You can usually do this by scanning the QR code of that address. Generally, most machines issue the cash right away, while some machines ask the receiver to confirm the transaction.
- Once the transaction is over, make sure to confirm the transaction. Also, wait for the machine to complete the transaction.
- You will receive a receipt from the ATM. Make sure to keep it properly, in case any problem occurs.
Pros And Cons Of Bitcoin ATM
Like every other form of ATM, there are different advantages and disadvantages to using Bitcoin ATMs (crypto ATMs). The following are some of the major pros and cons of using Bitcoin ATM:
Pros Of Bitcoin ATM
Here are the major pros of Bitcoin ATMs that you will benefit from:
1. Better Access To Bitcoin
One of the best things about a cryptocurrency is that there is no central authority governing its flow. Hence, there is no central system. Therefore, anyone can buy or sell Bitcoins in a Bitcoin ATM, whether that person has a bank account or not.
Furthermore, since Bitcoin ATMs are available across the world, it is also easy to find one. Another great thing about Bitcoin ATMs is that one can buy or sell Bitcoin using cash transactions.
2. Strong Security
Bitcoin ATMs come with strong security and easy access. Furthermore, since you will not need to share your personal information to perform a transaction, the platform tends to be more secure. However, in some cases, some particular crypto ATMs might want you to scan your ID before a transaction to ensure security.
3. You Can Buy And Sell Bitcoins
Most Bitcoin ATMs come with a lot of features. One of the greatest features is the presence of bi-directional functionality. This allows customers to buy and sell Bitcoins through the same machine. Furthermore, one can perform a transaction through a card or cash.
Cons Of Bitcoin ATM
Here are a few cons of Bitcoin ATMs that you will need to be aware of:
1. High Fees
Once you start buying and selling Bitcoins on a Bitcoin ATM, it will charge high fees. In some cases, some of them even charge more than 10% of the transaction. This is much higher than the fees of traditional crypto exchanges (which revolve around 1-4%). Hence, if you use a crypto ATM, you will have to pay quite high fees.
2. Uninsured Funds
In general, in crypto exchanges, you will receive custody services for your crypto funds. This is because these funds come with anti-theft insurance. On the other hand, in a Bitcoin ATM, you will need to deposit your funds into your digital wallet since there is no insurance on the funds. Hence, if you want to secure your cryptocurrencies, you will not have any insurance for loss or theft.
3. Limited Transactions
Just like other crypto exchanges, there shall be a minimum and maximum number of transactions in Bitcoin ATMs. In most cases, the minimum transaction limit is $10, while the maximum transaction limit is $10,000.
4. Lack Of Availability
Although there are many Bitcoin ATMs available, they are still not enough. Hence, there are limitations in the number and locations of Bitcoin ATMs. In some cases, you might need to travel long distances to get access to a Bitcoin ATM.
5. Limited Security
Bitcoin ATMs are physical ATMs that run on software. This is similar to traditional ATMs. Hence, there is always a chance of theft, which can be the result of tampering, skimming, etc. Therefore, there is a lack of security. Furthermore, you will also need to be aware of your surroundings when you are using these ATMs.
Wrapping Up
Hope this article was helpful for you in getting a better idea of how to get a Bitcoin ATM. You can see it is easy to locate a Bitcoin ATM through a mobile app if you want to buy/sell Bitcoins. However, if you want to buy/sell Bitcoin, try to stick to crypto exchanges since crypto ATMs charge a lot more for transactions.
Despite that, if you want to transact through an ATM, make sure you follow the steps mentioned above. Do you have more information to add on how to use a Bitcoin ATM? Consider sharing new information in the comments section below.
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